Crypto Market Update: Coins Directionless as Weekend Trade Volumes Drop 12%; What’s in Store for Next Week?

The cryptocurrency market was at a virtual standstill on Sunday, as bitcoin held below $3,500 and the major altcoins showed little direction. Trade volumes have declined sharply since Friday, reflecting a lack of committal from either the bulls or the bears.

Market Update

Most of the top-20 cryptocurrencies were trading slightly lower on Sunday, according to Coin360 data. Bitcoin edged down 0.8% to $3,453.75, having been unable to regain the $3,500 level. The leading digital currency has made several attempts to climb back above that threshold but has failed to do so in convincing fashion. From a technical standpoint, bitcoin must return above $3,550 to stave off another bear attack.

Related: Bitcoin Volatility Recedes as Bear Market Reaches 411 Days.

XRP declined 1.5% to $0.3028. The so-called ‘banker’s cryptocurrency’ enjoyed a sudden burst higher on Wednesday after the Swift messaging service announced it was partnering with a blockchain startup to test a new global payment standard.

Ethereum edged down 0.7% to $107.16 as attention returned to the upcoming Constantinople hard fork. Originally scheduled for mid-January, the fork was pushed back to late February after developers identified a security flaw with the proposed upgrade.

Stellar Lumens and Cardano were the biggest decliners in the top-20. TRX also reported minor losses.

On the opposite side of the ledger, EOS climbed 2.9% to $2.41. Litecoin rallied 0.9% to $33.34.

The total cryptocurrency market capitalization was little changed compared with 24 hours ago. At the time of writing, the market was worth $114.3 billion. Trade volumes reached $14.9 billion, having declined roughly 12% since Friday.

As we’ve seen before, a directionless crypto market is usually a precursor to further volatility. Investors should expect choppy trading conditions to persist through the early part of the week. In this environmental, bitcoin will continue to exert a strong gravitational pull on the broader market. A failure to break above the aforementioned levels could have a negative impact on the overall market.

Crypto Winter Grows More Frigid

In just over a week, cryptoassets will have endured its longest bear market in history. Bitcoin reached that threshold on Saturday after its bear market stretched beyond the 410 days seen in 2013-15. For cryptoassets as a whole, the number to watch is 420 days. As of Sunday, the crypto bear market had reached 408 days.

The cryptocurrency market is no stranger to volatility or prolonged bear trends. As Pantera Capital’s Dan Morehead recently noted, we are actually in our second crypto winter. The key difference between today’s bear market and the one that engulfed bitcoin in 2014-15 boils down to fundamentals.

Four years ago, nobody really knew whether blockchain would really work or whether decentralized currencies could garner mass appeal. Today, banks and global exchanges are investing billions into blockchain technology. Regulators are also realizing that digital assets are the wave of the future and are devoting more resources to understanding the market.

The U.S. Securities and Exchange Commission (SEC) has already deemed bitcoin and Ethereum to be non-securities due to their decentralized nature. While this cannot be said for initial coin offerings, blockchain projects are slowly embracing the idea of security tokens. This transition is expected to continue in 2019 as new platforms for STO listings emerge.

Read more: Security Tokens and STOs: A New Financial Frontier

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Chief Editor to and Contributor to, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi